Paul Ryan's Critics Miss the Big Picture

A few days ago, Republican Congressman Paul Ryan released a plan for helping people out of poverty. He unveiled the outlines in a talk at the American Enterprise Institute, a Washington-based think tank that seems to have emerged as the intellectual center of the so-called reform-conservatism movement. The plan involves making large block grants, called Opportunity Grants, to states, and instructing them to implement a raft of antipoverty programs. The most innovative of the programs involves having social workers directly help poor people take concrete steps to improve their lives in a number of dimensions.

As soon as the plan was released, a lot of liberal-leaning writers began to criticize it. Ezra Klein complained that the poverty plan would conflict with Ryan's own deficit-cutting proposals:

Ryan's budgets and his poverty plan aren't merely different. They're flatly contradictory. They cannot be implemented in the same universe at the same time. His budget, for instance, cuts deep into the funding stream that powers the Earned Income Tax Credit. His poverty plan sharply increases spending on the Earned Income Tax Credit. His budget cuts deep into food stamps and other income-support programs. His poverty plan holds their spending constant...Ryan's poverty plan can be seen either as an effort to move the Republican Party forward on poverty or as a Trojan Horse-like effort to achieve his budget's goals by other means[.]

Paul Krugman dismissed the plan outright, saying anything that comes from Ryan can't be trusted. Emily Badger wrote that Ryan's punitive, deadline-based approach to personal assistance is inconsistent with what we know about how poor people make decisions. Annie Lowrey called the plan too paternalistic, labeling it "condescending and wrongheaded." And Jamelle Bouie wrote that what the poor really need is not a "life coach," but more money.

This is just a small sampling of the negative responses from writers on the left. Only a very few struck a positive note, such as Matt O'Brien, who pointed out some elements of Ryan's plan that should please liberals.

These reactions are understandable -- Ryan has made a name for himself as an idea man, but this usually entails releasing plans that look bold but won't work. And many of the criticisms liberals make represent real shortcomings of the plan -- for example, it's clear that overall funding for poverty reduction would have to be increased substantially if it was to work.

But liberals are being much too quick to bash Ryan here. Ryan's plan, which is being hailed by conservatives and Republicans, potentially represents a huge tectonic shift in the conservative movement's -- and the Republican Party's -- approach to the problem of poverty.

First, there's the recognition that material poverty is important. Until recently, when confronted with the issue of poverty, conservatives often tended to sniff that the American poor were much richer than people in other countries, that relative poverty was just a product of envy, or that what the poor really needed was spiritual, not material, improvement.

Ryan's plan reflects a different attitude. It recognizes that chronic unemployment and underemployment are personally destructive and a drag on the economy. It expands the EITC, which is a way of writing poor people a check. It focuses on getting poor people better jobs, higher incomes, even some additional education. The idea of personal responsibility and good behavior is still there, but now it is treated as a means to an end, and the end is better material well-being.

Second, and even more importantly, Ryan's plan represents a sea change in the way Republicans see the role of government. In his first inaugural address, Ronald Reagan famously declared: "In this present crisis, government is not the solution to our problem; government is the problem." Over the next 2 1/2 decades, Republicans and conservatives tended to drop the "in the present crisis" part. They've treated government as an obstacle to human welfare always and everywhere, instead of a tool that can sometimes be used to improve things.

Ryan's plan is the first glimmer of a big awakening on the right -- the realization that the crisis we now face isn't the same as the one we faced in 1981. Perhaps a decade-and-a-half of falling real incomes and falling mobility has finally cracked the hard shell of triumphal post-Reaganism. If so, the fear that the conservative movement would degenerate forever into obstructionist self-parody -- that the Tea Party is the future -- has proven unfounded.

Think about it: In 2014, the Republican Party's main idea man -- who just two years ago ran for vice president on the same ticket as a man who called the poorer half of America "takers" -- is now proposing to use a government bureaucracy to send social workers to help poor people make more money, while simultaneously mailing them government checks. That is a big, big deal. Compared with that epochal shift, the particulars of Ryan's plan hardly matter.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

Noah Smith is an assistant professor of finance at Stony Brook University
and a freelance writer for a number of finance and business publications. He maintains a personal blog, called Noahpinion.
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